AmTrustee Bhd, a trustee of CapitaMalls Malaysia Trust (CMMT), has entered into a conditional sale and purchase agreement on behalf of it, to acquire Penang's Gurney Plaza Extension for RM223.3 million.

CMMT is managed by CapitaMalls Malaysia REIT Management Sdn Bhd (CMRM).

CMRM chief executive officer Sharon Lim said the purchase is part of the company plans to integrate the extension with CMMT's Gurney Plaza Shopping Mall portfolio.

"Gurney Plaza Extension is fully occupied, and the proposed acquisition will present a unique opportunity for us, to make the combined mall an even more compelling shopping destination in Penang," she said in a statement today.

She added, the acquisition will be funded through a mix of debt and equity, which includes placing out new CMMT units.

CMMT is the country's largest shopping mall real estate investment trust by market capitalisation and property value.

Listed on the Main Market of Bursa Malaysia Securities Bhd, CMMT's market capitalisation is estimated at RM1.4 billion, while its portfolio has been valued at RM2.13 billion.

Gurney Plaza Extension is a nine-storey retail extension block with a net lettable area of about 139,964 square feet and has been valued at RM225 million.–BERNAMA

SOURCE: Business Times

Malaysia’s central bank will probably keep interest rates unchanged for a second consecutive meeting to support its economy as global growth weakens and inflation eases.

Bank Negara Malaysia will leave its benchmark overnight policy rate at 2.75 per cent tomorrow, according to all 16 economists surveyed by Bloomberg News. The central bank will release its monetary policy decision at 6 pm in Kuala Lumpur after its final rate-setting meeting for 2010.

“While first-half growth was very robust, the outlook for the economy going into 2011 remains uncertain given external developments,” said Alvin Liew, a Singapore-based economist at Standard Chartered Plc. “Inflation remains benign and is unlikely to be a factor in setting the overnight policy rate, at least for now.”

A delay in adding to Malaysia’s three rate increases since early March would avoid widening a gap with borrowing costs in advanced economies that’s contributed to a 10.7 per cent gain in the ringgit this year. Governor Tan Sri Dr Zeti Akhtar Aziz said last week Asian policy makers are willing to act “collectively” on capital flows if needed, amid concern US stimulus will push funds to the region.

The ringgit is this year’s second-best performing currency in Asia excluding Japan, behind the Thai baht. It rose 0.1 per cent to 3.087 per dollar at 10:14 am in Kuala Lumpur today. The benchmark stock index closed at a record high yesterday.

Financial Imbalances

Malaysia started raising rates before any other central bank in Asia this year to reduce what it said was the risk of financial imbalances that may be caused by keeping borrowing costs too low for too long. Policy makers increased the key rate by 0.75 percentage point from March to July.

India’s central bank raised borrowing costs for a sixth time this year on Nov. 2 and said the chance of further policy tightening in the “immediate future is relatively low.” The same day, the Reserve Bank of Australia unexpectedly increased its benchmark interest rate for the first time in six months.

Other Asian central banks are maintaining borrowing costs or delaying increases to avoid attracting capital inflows as the region’s growth lures funds at a time when Japan and the US are keeping rates low to boost their economies. Bank Indonesia kept its benchmark interest rate at a record low last week.

The US Federal Reserve last week announced plans to buy US$600 billion of long-term government bonds in its second effort at so-called quantitative easing, aiming to stoke economic growth. Policy makers from Asia to South America have said the stimulus could depress the dollar and spark capital flight to emerging markets.

‘Appropriate’ Level

Zeti said in October the current rate level is “appropriate,” suggesting policy makers may wait before taking further action. Malaysia’s inflation rate fell to a three-month low of 1.8 per cent in September.

“We don’t see inflationary pressures at this point in time, although we have strong demand,” Zeti said Oct. 26. “Interest rates at this point in time are at appropriate levels.”

Malaysia’s exports rose at the slowest pace in 10 months in September as shipments to the US and China eased. The Southeast Asian economy, whose products include IOI Corp palm oil and Intel Corp computer chips, may experience some deceleration in the final quarter of 2010, International Trade & Industry Minister Mustapa Mohamed said last month.

Building Towers

Prime Minister Datuk Seri Najib Razak, who expects growth to ease to a range of 5 per cent to 6 per cent next year from 7 per cent in 2010, has unveiled projects including a 100-floor tower and mass rail systems to revive investment and spur economic expansion.

While Bank Negara Malaysia left interest rates unchanged at its September meeting, it is using other tools to prevent asset bubbles from forming.

The central bank this month placed a limit on the loan-to- value ratio for people taking out third mortgages to buy homes in a bid to moderate “excessive” investment and speculation in urban areas. A maximum lending limit of 70 percent took effect on Nov. 3. Banks such as Malayan Banking Bhd, the country’s largest lender, typically provide loans of as much as 90 per cent of the value of a property.

“While Malaysia is not experiencing a general property bubble, targeted pre-emptive measures are appropriate to moderate the increases in property prices that are evident in selected locations that are speculative in nature,” Zeti said last week. — Bloomberg

SOURCE: Business Times

PENANG-based furniture exporter Creative Furnishing Sdn Bhd is set to sign several joint-venture arrangements with its suppliers in the region.

Its managing director Stanley T.C Chew said the tie-ups are expected to be firmed up by early 2011 and that the move was to ensure that better quality control is maintained for its products.

"We want to continue keeping our export-quality furniture items at factory-direct prices," Chew told Business Times.

Creative Furnishing, which has been in business for more than three decades, is one of Malaysia's furniture export pioneers, with a manufacturing facility in Vietnam.

Its products – ranging from bedroom, dining to outdoor furniture and other collectible furnishing items are shipped to various countries. Europe accounts for a 70 per cent share of the company's exports.

Its headquarters in Penang island boasts a 12,000 sq ft show house for its full range of knock-down furniture items.

A retail shop lot serviced by the company is located at Island Plaza on the island.

"Besides retailing locally while dealing with furniture importers and wholesalers, we also work with property developers, architects and interior designers both in Penang and as far as Singapore, who source furniture for residential and commercial property developments," Chew said.

Mindful of the lean spell being currently experienced by furniture-makers, owing to the strong ringgit against the US dollar and euro, Creative Furnishing is now looking to build up its local business by tapping into more property development projects.

"The property industry is very vibrant at the moment and we see no reason why our Western-inspired and contemporary products cannot be sourced locally for these projects," he said.

SOURCE: Business Times

KUALA LUMPUR: Mah Sing Group Bhd is confident the local property market is sustainable as the current buying activities are backed by economic fundamentals and genuine purchasers.

“Despite Bank Negara’s measure to cap the loan-to-value ratio at 70% for third and subsequent house purchase, the prevailing low interest rate, healthy employment market and the fact that property investments have proven to be a reliable asset class will continue to sustain and drive the sector,” group managing director and chief executive Tan Sri Leong Hoy Kum said.

The Government’s Economic Transformation Programme to pave the way for the country to become a high-income nation will also boost demand for properties in economic hot spots that include the Greater Kuala Lumpur, Penang and Johor.

Leong said careful market studies to match supply with demand was necessary to make sure that the products offered meet market needs in terms of concept and design.

“It is important to invest in research and development to continuously create a healthy, sustainable and eco-friendly lifestyle. Other attributes include good locations, unique concepts and on-time delivery of quality products,” he told StarBiz.

Leong said gated and guarded landed properties seemed to be the most sought after, both for new launches and the secondary market.

“Besides a good location, buyers today place more importance on security, concept, design and lifestyle.

“The current price trend for link homes in good locations are approximately RM700,000 onwards for double-storey link homes and RM1mil onwards forthree-storey link homes,” he added.

Leong said Mah Sing was confident of chalking up sales of more than RM1.5bil this year after having turned in RM1.02bil for the first seven months this year from projects in the Klang Valley, Penang and Johor.

As at June 30, the company had unbilled sales of RM1.17bil, nearly twice the revenue recognised in 2009.

“Our landed properties generally attract local buyers, and our serviced residences have a higher quantum of foreign buyers due to ease of maintenance,” Leong said.

As part of the company’s marketing strategies, Mah Sing takes part in property exhibitions locally and overseas as they are good brand-building campaigns.

“We look forward to the upcoming Star Property Fair on Nov 19-21 at the Kuala Lumpur Convention Centre, and will be showcasing some of our latest projects at the fair,” he added.

The company currently has 15 ongoing projects while 10 projects are at various stages of planning. Its existing projects include One Legenda and Hijauan Residence in Cheras, Garden Residence in Cyberjaya, Perdana Residence 2 in Selayang, Icon Residence Mont’ Kiara, Aman Perdana in Meru-Shah Alam, Southgate, StarParc Point, iParc@Bukit Jelutong and iParc 2@Shah Alam in Kuala Lumpur and Klang Valley, Legenda@Southbay and Residence@Southbay in Penang island as well as Sri Pulai Perdana 2, Sierra Perdana and Austin Perdana in Johor Baru.

Those in the drawing board include M Suites @ Jalan Ampang, Kinrara Residence and Kinrara joint venture project, Garden Plaza in Cyberjaya, Star Avenue@D’Sara in Sungai Buloh, Icon City in Petaling Jaya, iParc3@Bukit Jelutong, and Bayu Sekamat in Hulu Langat in Kuala Lumpur and Klang Valley as well as Southbay Plaza and Icon Residence in Penang island.

Mah Sing is previewing its second project in Cyberjaya, namely Garden Plaza comprising Garden Suites (residential) and Garden Retail which are lifestyle retail shops.

The project-awareness exercise has attracted more than 2,000 registrants for the Garden Suites. Comprising fully-furnished small to medium-sized units that will be furnished and in move-in condition, the units are targeted at both users as well as investors looking to tap the vibrant student population in Cyberjaya which is currently in excess of 17,000.

The indicative price for the smallest unit of 500 sq ft starts from RM236,800 and there are flexible sizes to meet various requirements.

Leong said the company’s medium to medium-high end properties, including M-Suites@Jalan Ampang, received overwhelming response during its preview. M-Suites offers freehold apartments from 502 sq ft to 1,630 sq ft which are designed specifically to provide easy ownership and ensure long-term rental demand – criteria which appeal to both investors and residents alike when investing in the city.

The residential landed projects in Cyberjaya, Selayang and Bandar Kinrara had also attracted positive response. Garden Residence in Cyberjaya comprises two- and three-storey superlink and semi-detached as well asthree-storey bungalows. The gated and guarded project has been very successful, with sales hitting RM419mil as at July this year. Meanwhile, Perdana Residence 2, a gated and guarded project in Selayang, achieved more than 98% in take-up rate since its launch in March.

Kinrara Residence, a mixed residential development comprising super links, semi-detached units and executive bungalows priced from RM708,800, has also garnered positive response.

The gated and guarded development offers a communal lifestyle living with a clubhouse equipped with facilities such as swimming pool, wading pool, changing rooms, gymnasium and a community centre.

SOURCE: The Star

FORMER Kampung Buah Pala residents can expect to move into their new homes by early next year, ahead of schedule.

Deputy Chief Minister II Dr P. Ramasamy said that construction of the houses would be completed in January and the families could expect to move in after the occupancy certificate is obtained.

The group, evicted from their century-old village in Gelugor in Penang last year, had opted for compensation of double-storey houses estimated at RM500,000 each.

Dr Ramasamy said this after giving the 15 families RM500 each for Deepavali yesterday.

Representatives from the 15 families were present and some shed tears after receiving the aid.

M. Velavan, 18, who came with his father and grandmother, said they would use the money to buy food and clothing to celebrate the festival.

He said they were glad to hear that the houses would be completed ahead of schedule.

He said he and his parents and siblings were living in a rented two-room flat in Jelutong.

SOURCE: The Star